Silver Market Morning

Gold Today –New York closed at $1,179.20 up $5.10. Asia took it and London then pulled it back to $1,175.80. The dollar recovered by 1.5 cents to $1.1174 and the dollar Index was lower at 95.24 after being 95.61. The LBMA gold price was set this morning at $1,175 down $1.50. The euro equivalent was €1,051.92 down €12.79. Ahead of New York’s opening, gold was trading in London at $1,172.60 and in the euro at €1,048.23.

Silver Today – The silver price fell to $15.72 down 8 cents in New York. Ahead of New York’s opening it was trading at $15.70.

Gold _{(very short-term)} The gold price will consolidate, in New York today.

Silver _{(very short-term)} The silver price will consolidate, in New York today.

Price Drivers

With markets now trying to settle and assess the way forward, we are now at default time, the day when Greece must make its large repayments of €7.2 billion. It is clear it doesn’t have this money nor does it intend to repay it until after the referendum. The stark contrast between Greece’s situation and those seen in South Africa and Zimbabwe and other nations that found themselves turning inwards financially and away from politics, is that Greece’s situation is now primarily political. Neither the system, nor the people of Greece have the same determination to survive economically outside the E.U. In the countries we mentioned, once they were shut out, they experienced economic booms as imports were replaced by local endeavor. In Greece, after the referendum, we could see new elections and economic chaos. In the light of this our ‘gut’ feel is that Greece will stay in the E.U. and suffer for a long, long time. But the next week will see a gradual absorption of what lies ahead and any remaining drama will be seen next week.

Gold & silver will only react once it is clear that Greece will leave the E.U. and euro. If it doesn’t we expect the scene will be gold and silver neutral. In an environment of, at best, a fragile economy, neither the Eurozone nor the global economy is in a position to withstand another economic or currency system shock. -For more - Subscribe www.goldForecaster.com

The fall in U.S. equity markets, we believe, was due to its being overpriced not to Greece, at all. Any talk of interest rate hikes will see both equity and bond markets tumbling, simply because investors in those markets are looking for yield, not good future prospects. So we may see further equity market falls across the world, with Greece simply a trigger. It is hoped that Greece won’t be the shot that started World War 1 in the financial world. But if it is anything like that, the environment for gold and silver will change dramatically. What is clear is that the environment for precious metals may appear to be neutral, but we are very close to the time when it comes into its own.

On Monday there were no sales or purchases from or into the SPDR gold ETF, or the Gold Trust. The holdings of the SPDR gold ETF are at 711.439 tonnes and at 167.79 tonnes in the Gold Trust.

Silver– Silver appears to be leading the way down for gold at the moment. But bear in mind the silver price describes North American monetary views and gold, global views. Subscribe www.SilverForecaster.com

Regards,

Julian D.W. Phillips for the Gold & Silver Forecasters